*                         7/31     8/7      8/14     8/21/23
S&P 500 Index             4582.23  4478.03  4464.05  4369.71
Trailing 12 month PE      25.44    24.76    24.17    23.64
Trail Earnings yield      3.93%    4.04%    4.14%    4.23%
Forward 12 month PE       21.84    21.27    21.16    20.60
Fwd Earnings Yield        4.58%    4.70%    4.73%    4.85%
90 day tbill yield        5.52     5.54     5.54     5.55
10 year tbond yield       3.96%    4.05%    4.16%    4.26%
Arezi Ratio               1.40     1.37     1.34     1.31
Fed Ratio                 0.86     0.86     0.88     0.88

The Arezi Ratio is the 90 day tbill yield divided by the trailing
earnings yield of the S&P500. A low ratio means that stocks are undervalued.

The 'Fed Ratio' is the 10 year treasury bond yield divided by the
forward estimated operating earnings yield of the S&P500. A low ratio
means that stocks are undervalued. Thus, a ratio of 0.71 for example
means, according to Yardeni, that stocks are cheaper than 'fair value'
by 29%.

The 'S=120-50*Arezi Ratio' formula indicates an allocation of 54%
stocks, 46% cash this week.

Other timing indicators:
The S&P index is above its 200DMA. - Bullish
We are in the May-Oct part of the year. - Bearish
The trailing PE ratio of the S&P is above 17. - Bearish
The treasury yield curve is inverted. - Bearish

A composite allocation may start with the Arezi formula and subtract 10%
for each bearish indicator. The current target allocation is 24%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 71%.

Elan

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